SDG&E Claimed Corporate Political Ads Protected by 1st Amendment... But Even If Misleading/False?

A recent decision by the California Public Utilities Commission ("Decision 10-05-050 May 20, 2010") appears to warn Pacific Gas & Electric (PG&E) and other investor-owned power utilities to not make misleading or false claims in public regarding community choice aggregation (CCA). The City and County of San Francisco had complained to CPUC regarding several instances of recent false or misleading anti-CCA advertising by PG&E.

CPUC modified a previous 2005 decision "to make clear that, if utilities engage in commercial speech concerning CCA service and the utility’s competing service that is untrue or misleading, they may be liable for penalties and subject to a temporary restraining order or preliminary injunction in a complaint before the Commission..."

PG&E has spent well over $28 million in an advertising campaign in favor of Proposition 16's new two-thirds voting requirement for municipal expenditures on providing electricity either directly to customers or through the use of a local CCA option. Proposition 16 will be decided in the June 8 primary election.

Prominent in the PG&E-paid advertising is the statement that voters have no right to vote against municipal government expenditures for a municipal power that may include a CCA option.

According to http://www.taxpayersrighttovote.com/learn, "Right now local governments in California can take over private electric businesses without letting local voters have the final say in the decision. Proposition 16 establishes clear voter approval requirements before local governments can go into the retail electricity business. ... Paid for by Yes on 16/Californians to Protect Our Right to Vote, major funding from Pacific Gas and Electric Company and CA Business PAC, sponsored by CA Chamber of Commerce, a coalition of taxpayers, business and labor."

San Diego Pre-Existing Voter Rights

Voters in San Diego already have the electricity franchise right since 1970 to make franchise changes (including options for CCA as approved by state legislation in 2002) by a simple majority vote. More than a week after CPUC's decision above, Proposition 16 advertising in favor makes no mention of existing voter rights by franchise or under California Constitution voter rights to the initiative and referendum process, likely factors in determining that PG&E-paid advertising is false or misleading.

In a related filing, San Diego Gas & Electric (SDG&E) officials claim that such corporate-paid advertising should be viewed as political expression protected by the First Amendment to the Constitution of the United States of America. According to Kim Hassan, attorney for SDG&E, "The [United States] Supreme Court held that corporations have a First Amendment right to make contributions in order to attempt to influence political processes. ... The Court ultimately concluded that such expression — even on behalf of corporations and even if apparently motivated by commercial self-interest — was fully protected by the First Amendment."

SDG&E's Hassan did not offer the Supreme Court's opinion in the officially reported case, 435 U.S. 765 (1978), as to misleading or false corporate political statements motivated by commercial self-interest.

According to CPUC, "It is clear that commercial speech that is untrue or misleading is not protected speech."


DECISION [10-05-050 May 20, 2010] MODIFYING DECISION 05-12-041 TO CLARIFY THE PERMISSIBLE EXTENT OF UTILITY MARKETING WITH REGARD TO COMMUNITY CHOICE AGGREGATION PROGRAMS

DECISION [05-12-041 December 15, 2005] RESOLVING PHASE 2 ISSUES ON IMPLEMENTATION OF COMMUNITY CHOICE AGGREGATION PROGRAM AND RELATED MATTERS


Find reported US Supreme Court opinions at the San Diego County Public Law Library, http://www.sdcll.org or downtown at 1105 Front Street in the Justice Complex.

Comments

Sign in to comment